The mineral output is projected to rebound this year growing by 1,6% from a negative growth of -2,5% in 2015 on the back of bullish sentiment by players, the Chamber of Mines of Zimbabwe (CoMZ) has said.
BY TARISAI MANDIZHA
In the past two years the mining sector output recorded negative growth of around -3,4% and -2,5% in 2014 and 2015 respectively.
According to CoMZ Mining Industry survey report 2015 released yesterday, at least a fifth of the respondents were bullish that they would grow by at least 5%. About 30% planned to grow output by between 1% and 4%. About 10% planned to maintain their output, while 40% projected decline in mineral performance in 2016.
Nickel and gold producers planned to increase output in 2016 compared to other sectors with respondents in nickel (100%) and 68% in gold saying they would increase output in 2016.
“Mining output generally declined in 2015 compared to 2014 except for gold which rose 30% and platinum 1% and copper which remained flat. Chrome recorded the steepest decline of -48%, followed by coal -34%, diamond -30% and nickel -3%,” CoMZ said. It said the sector was facing challenges such as capital constraints, power shortages, high power tariffs and high production costs.
The report said the mining sector contributed 14,8% of total mining revenue and 16,7% in 2015 to government and related departments.
The report showed that mineral revenue was concentrated in a few minerals despite the country having 40 minerals that have been commercially exploited.
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“Mineral revenue appears to have become more concentrated in few mineral commodities. The top three mineral commodities accounted for 72% of total mineral revenue in 2015, up from 69% in 2014. The top four minerals also bulked up their share to 83% in 2015 from 80% in 2014. The top five contributed 91% in 2015 compared to 90% in 2014,” it said.
The report added that only five mineral commodities accounted for more than 90% of the value of mineral output in 2015 in spite of Zimbabwe’s rich mineral endowment consisting of over 60 minerals 40 of which have been commercially exploited at some point.
Gold accounted for an increased share of the total mineral revenue in 2015 at 40% compared to 29% in 2014.
The mining sector contribution to gross domestic product is estimated to have fallen to 9% in 2015 down from 9,2% in 2014 and 10% in 2013.
Commenting on capacity utilisation, CoMZ said the data collected showed that average capacity utilisation in the mining sector declined to 60% in 2015 from 71% in 2014.
“A steepest decline in capacity utilisation was recorded in chrome which slumped to 29% from 67% and coal down to 20% from 34%,” CoMZ said.
